HOUSE FINANCE COMMITTEE May 7, 1998 4:30 P.M. TAPE HFC 98 - 160, Side 1 TAPE HFC 98 - 160, Side 2 TAPE HFC 98 - 161, Side 1 CALL TO ORDER Co-Chair Gene Therriault called the House Finance Committee meeting to order at 4:30 p.m. PRESENT Co-Chair Therriault Representative Kohring Representative Davies Representative Martin Representative Davis Representative Moses Representative Kelly Representative Mulder Co-Chair Hanley and Representatives Grussendorf and Foster were absent from the meeting. ALSO PRESENT Mel Krogseng, Staff, Senator Taylor; Ben Brown, Staff, Senator Kelly; Annette Kreitzer, Staff, Senate Labor and Commerce Committee; Catherine Reardon, Director, Division of Occupational Licensing, Department of Commerce and Economic Development; Pat Davidson, Legislative Auditor, Legislative Audit Division; Kate Coleman, Radiology Health Specialist, Department of Health and Social Services; John Bitney, Legislative Liaison, Alaska Housing Finance Corporation, Department of Revenue; Catherine Reardon, Director, Division of Occupational Licensing, Department of Commerce and Economic Development; Sidney Heidersdorf, Radiological Physicist, Juneau; Kathleen Strasbaugh, Assistant Attorney General, Department of Law. The following testified via the teleconference network: Dr. Woller, President Alaska Dental Society, Fairbanks; Lynn Levengood, Attorney, Anchorage; Stan Leaphart, Fairbanks. SUMMARY SB 160 "An Act relating to registration, inspection, and testing relating to radiological equipment in dentists' offices." SB 160 was HELD in Committee for further consideration. SB 223 "An Act lowering the age requirement from 60 years to 55 years for purposes of senior housing programs; and repealing a provision relating to the interest rate on senior housing loans made by the Alaska Housing Finance Corporation." CSSB 223 (FIN) am was REPORTED out of Committee with "no recommendation" and with a zero fiscal note by the Department of Revenue, dated 1/28/98. SB 236 "An Act extending the termination date of the Citizens' Advisory Commission on Federal Areas in Alaska; and providing for an effective date." CSSB 236 (RES) was REPORTED out of Committee with a "do pass" recommendation and with a fiscal impact note by the Department of Natural Resources dated 3/10/98. SB 358 "An Act relating to disclosure of the use of state funds related to personnel records." HCS CSSB 358 (FIN) was REPORTED out of Committee with "no recommendation" and with a fiscal impact note by the Office of the Governor, dated 4/30/98. SENATE BILL NO. 160 "An Act relating to registration, inspection, and testing relating to radiological equipment in dentists' offices." MEL KROGSENG, STAFF, SENATOR TAYLOR testified in support of SB 160 on behalf of the sponsor, Senator Taylor. She noted that SB 160 changes the procedures for inspecting and registering dental radiological equipment. She maintained that on-site inspections by the Department of Health and Social Services are unnecessary because the incidence of x- ray overexposure is so insignificant as to be non-existent. Some states do not have a requirement for registration or inspection of dental radiological equipment. Ms. Krogseng observed that SB 160 would transfer the registration of dental radiological equipment to the Board of Dentistry. Inspection activities would be done by the private sector. The owner or lessee would be responsible for providing the Board with documentation showing that the equipment is registered and has been inspected within the past fives years. SB 160 would place the registration of dental radiological equipment with the Board of Dentistry. The owner of the equipment will be responsible for providing documentation to the Board that the equipment is registered and has been inspected within the past five years. The Board will establish inspection criteria. Ms. Krogseng stressed that if a dentist uses unregistered or uninspected equipment, they will be subject to a civil penalty in the form of a fine, levied by the Board, not to exceed $5000 for each offense. Ms. Krogseng maintained that some dentist have gone as long as seven to ten years without inspections due to a lack of qualified inspectors. She stressed that dentist want to have inspections. She asserted that the legislation would make inspections and corrections more efficient. She observed that the Alaskan Dental Society supports the legislation. She provided members with Amendment 1. Amendment 1 would include completion of a United States Department of Defense biomedical equipment technician's course and the International Certification Commission for Clinical Engineers and Biomedical Technology as allowable qualifications for inspectors (copy on file). Representative Martin expressed concern with the need for the legislation and questioned if dentist will support the legislation through fees. Ms. Krogseng clarified that the program would be revenue neutral. Fees would offset the cost. The Board of Dentistry would only have an administrative function. The Board would receive and track forms submitted by private inspectors. There are a total of 241 dentist facilities in Alaska. There are a number of private sector persons that would qualify as inspectors. Representative Martin asked what insurance the public would have that some objective overview was performed. He maintained that oversight is needed outside of the dentistry profession. Ms. Krogseng maintained that the risk with dental equipment is miniscule. She observed that equipment must meet federal standards. DR. WOLLER, PRESIDENT ALASKA DENTAL SOCIETY, FAIRBANKS testified via teleconference in support of the legislation. He stressed that the risk is minimal. The people that do the actual calibration will monitor equipment and the Board would provide oversight. He noted that there was a 12-year period where his equipment was not inspected. He maintained that six feet of air absorbs all radiation. He explained that the Association recommends that inspections be once every five years. This is consistent with practices in other states. Manufactures recommend every year. Representative Davies asked for more information regarding federal regulations. Dr. Woller noted that there are federal regulations regarding shielding and distance between radiation. There are no federal permits. CATHERINE REARDON, DIRECTOR, DIVISION OF OCCUPATIONAL LICENSING, DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT provided information regarding SB 160. She observed that the Dental Board did not request the responsibility. The Dental Board was opposed to the original legislation. The Department of Commerce and Economic Development is concerned that the legislation would result in duplication of expertise and effort. The Department of Health and Social Services is knowledgeable about radiation. The Dental Board and the Department of Commerce and Economic Development are not knowledgeable about radiation. The Department of Commerce and Economic Development is concerned about the availability of potential inspectors and the potential cost. Each owner would be responsible for inspections. The charge could be substantial in rural Alaska. KATE COLEMAN, RADIOLOGY HEALTH SPECIALIST, DEPARTMENT OF HEALTH AND SOCIAL SERVICES testified in opposition to SB 160. Ms. Coleman is one of two radiological health specialists employed by Alaska's Department of Health and Social Services. She expressed concerns that the legislation would diminish the capacity of public health by diluting the regulation of dental x-ray. On the international radiation protection scene, the International Commission of Radiation Protection would like to lower the exposure limit for occupationally exposed radiation workers. The bill would remove from occupationally exposed dental workers government regulation aimed at keeping their radiation exposures to as low as reasonably achievable. Ms. Coleman noted that questions have been raised about the health effects and risk related to dental x-ray exposure. There is an indication of risk in the technical paper of Dr. Smart Smith of the UCLA School of Dentistry. "While the risk from dental radiography is certainly small in terms of other risks we readily assume during our daily lives such as driving, smoking, eating fatty food, there is no basis to assume it is zero .... prudence suggests we should be cautious because of the large numbers of people exposed to dental radiography... Recent studies suggest the lifetime cancer risk from exposure to low levels of ionizing radiation may be greater than previously estimated .... The International Commission for Radiation Protection data shows that the estimated risk has increased four-fold. Cancers other than leukemia typically start to appear about 10 years following exposure and remain in excess for the lifetime of the exposed individuals." Citing specific cancers, Dr. White notes "an association with leukemia, the risk to children being greater. Thyroid cancers increase in humans following exposure to ionizing radiation. About 10% of individuals with such cancers die from their disease. A case-control study has shown an association between brain cancer and previous medical or dental radiography. Several studies have shown an association between tumors of the salivary glands and dental radiography." As long as there is a risk it needs to be monitored the Department of Health and Social Services has responsibility for protecting the public health. Ms. Coleman maintained that there is an absence of checks and balances. She maintained that the bill presents a conflict of interest and the credentials for inspectors are lax. "For instance, are they qualified to operate radiation- measuring equipment, to calculate skin dose, to evaluate film quality, perform shielding calculations and scatter radiation measurements. A certification program for the inspectors administered by the state should be in place to keep the standards high." Ms. Coleman asked who would design the inspection procedures? Will the Board be taking on responsibilities for physics and engineering? What role will the Board have in regulating radionuclides included in Section 08.36.075(g)?" Ms. Coleman observed that the bill does not include radiation protection, film processing, nor x-ray operator competence. "Yet, the majority of problems in dental radiography are a result of film processing and operator error. Frequently, in an attempt to improve film quality, an inexperienced operator will increase the radiation exposure rather than use appropriate film processing". Ms. Coleman asserted that the bill creates duplicate functions between two state agencies. "The type of organization proposed by this bill is unusual by any state's standards since the professional board is so distant from the technical aspects of radiation protection. Alaska, like many other states, struggles to maintain a sufficiently trained supply of personnel to meet the public health needs of the State. It is wasteful to establish parallel lines of expertise in two separate departments". Ms. Coleman pointed out that AS 18.60.475(a)(7) authorizes the Department of Health and Social Services to "contract with other State agencies to assist them in performing functions that require expertise in determining and reducing the hazards of radiation." She stressed that this authorization is cognizant of the unique qualifications necessary to understand and satisfactorily implement a responsible radiation control program. "It is clearly designed to assure that this relatively rare expertise is shared with other parts of the government. It seems wasteful to depart from that philosophy and establish duplicative expertise in another department". Ms. Coleman questioned if there would be sufficient resources available statewide to support this function in Alaska. "Passage of this bill would serve to provide less protection for Alaskan citizens. Already thin resources will be spread less effectively." Representative Mulder questioned how thin resources would be spread more thinly. Ms. Coleman explained that the Department of Environmental Conservation, Department of Labor, Department of Health and Social Services and Department of Commerce and Economic Development would all be performing radiation work. Representative Mulder asked how Dr. Woller's concerns regarding the frequency of inspections would be addressed. Ms. Coleman clarified that there is currently one full-time and one quarter-time inspector working with the Department of Health and Social Services. She maintained that all facilities would be inspected every three years. She stressed that an additional inspector was hired in May 1998. Representative Mulder observed that the Dental Association supports the legislation. The Dental Board has not taken a formal position on the proposed committee substitute. In response to a question by Representative Martin, Ms. Coleman clarified that the legislation would remove the responsibility for inspections from the Department of Health and Social Services. She added that dentist have always had the option of hiring technicians to service their equipment. She emphasized that health specialists do not do the same work as technicians. Representative Martin expressed concern with the transfer to the Department of Commerce and Economic Development. He asked if the Dental Board would rubber-stamp the certification. Ms. Reardon observed that the Dental Board would contact owners to make sure that they are registered and have submitted their certification. Violations would be charged. Representative Martin asked if the Dental Board has the ability to oversee medical specialists. Ms. Reardon noted that the Department of Commerce and Economic Development has staff that assists medical boards. Staff is not knowledgeable on health care or medical issues. A clerk position would be hired to process paper. There are approximately 500 pieces of equipment to register. The Board will need to formulate regulations. Representative Davies asked for further clarification in regards to the qualifications of a health specialist and a medical electronic technician. He noted that an inspector would not need a degree. They could have four years of experience. Ms. Coleman explained that a health specialist is trained in radiation protection. They are not trained in electrical aspect of the equipment. They are concerned with the radiation exposure to the operator and the patient. The health specialist assesses the amount of exposure the patient is receiving. This is compared to the acceptable range. Problems are frequently not with the equipment, but with the film processing. The x-ray operator mistakenly turns up the radiation exposure in trying to get a better picture. The legislation does not direct anyone to look at film processing. Representative Davies noted that the Department of Health and Social Services is proposing to test machines every three years. He asked what is the standard practice. Ms. Coleman noted that the rate of inspections varies. She maintained that inspections should be every three years in Alaska because there is not easy access to service companies. Representative Davies asked if radiation is absorbed in six feet in every case. Ms. Coleman emphasized that x-ray heads are wider and easier to move around. There is a lack of shielding in the x-ray head. There is a potential for more radiation. Representative Davies questioned if comments regarding the low level of radiation and long lasting calibration were accurate. He asked if older equipment would meet this description. Ms. Coleman observed that she discovered a gassing x-ray tube. The radiation from the x-ray head was exponentially doubled. A technician had not caught the problem. Ms. Reardon pointed out that the legislation would take effect 90 days after passage. She noted that all machines would have to be inspected and display inspection stickers within 90 days. She suggested that January 1, 1999 as the quickest recommended effective date. LYNN LEVENGOOD, ATTORNEY, ANCHORAGE testified via teleconference in support of the legislation. He maintained that he legislation would provide better protection to Alaskans. Regulators would be able to concentrate on higher dose radioactive equipment. He observed that machines are in daily use. He maintained that malfunctions would be perceived in the quality of the x-ray. He maintained that the risk is minimal. SIDNEY HEIDERSDORF, RADIOLOGICAL PHYSICIST, JUNEAU testified in opposition to SB 160. He observed that he worked in the field of radiation safety for 38 years. He was the state Radiological Physicist for 20 years. He emphasized that the public is directly exposed to ionizing radiation from dentistry equipment. He stressed that oversight should not be transferred to a different department based on the risk level. He observed that the legislation calls for experience in installing and calibrating x-ray equipment. A radiological health specialist evaluates radiation risks. The maintenance person is a mechanic. He emphasized that the jobs are different. He did not think the qualifications contained in the bill would meet the qualifications needed to do radiological health evaluations. (Tape Change, HFC 98 - 160, Side 2) Mr. Heidersdorf maintained that installers are blas about radiation exposure. He disagreed that dental x-ray radiation would be absorbed in six feet of air. He pointed out that it is difficult to compare environmental radiation with dental x-rays. Dental x-ray radiation is exposed to a small area of the body. He pointed out that dental x-ray equipment uses the same voltage as other medical x-ray equipment. The risk is less because of the narrow band. The thyroid is at risk when doing dental x-ray work. He observed that in his 20 years of work no dentist every requested an inspection. He maintained that there are other reasons dentist want the program moved to the Department of Commerce and Economic Development. The federal standard is basically a manufacture standard. It applies to one year. He viewed the legislation as a company rubber stamp of approval with less oversight. He stressed that it is unwise to turn the program over to administrators that will not be able to provide oversight. He acknowledged a problem with frequency of inspections. He used exposure range to determine priorities in visits. He recalled that approximately 40 percent of the dentist offices were out of the acceptable exposure range. Mr. Heidersdorf referred to page 2, lines 8 and 9. "The board shall adopt the stricter of the two standards unless adoption of the other standard would not present a risk of harm to the public or to the operator of the equipment." He questioned who would make the determination of risk. He noted the use of "radionuclides" on page 3, line 9. He stated that he did not know of "radionuclides" in dental x- ray equipment. Representative Kelly stressed that it is not necessary for a person to have a degree in radiation physics. Mr. Heidersdorf clarified that he objected to the removal of the program from other programs dealing with x-rays. He maintained that adequate thought has not been given to the people that would be doing the inspections. He questioned who would establish the standards. He asked if the Board of Dentistry would develop standards for dental practice. He stressed that the program is more than hardwire. He stressed that there is the whole area of use. How is the film developed is a huge issue. He asked if inspectors would evaluate the darkroom processing of dental x-rays. The only difference between a x-ray and a light ray is energy. Representative Davies pointed out that 2 - 4 x-rays might be taken at a visit. Mr. Heidersdorf stressed that the damage is a function of dose level. The exposure would not be multiplied if the exposure were to a different area of the face. Representative Martin asked what Mr. Heidersdorf would do to improve the legislation. Mr. Heidersdorf replied that the legislation is a mistake. Representative Kelly maintained that it is an administrative problem not a matter of standards. He spoke in support of the legislation. Representative Davies felt it was more than an administrative issue. He thought that moving the program to the Board of Dentistry would result in a conflict of interest or an appearance of a conflict of interest. Ms. Krogseng maintained that the educational background of the potential inspectors would be somewhat equivalent to those in the Department of Health and Social Services. She envisioned that inspectors would go to several villages at one time to reduce costs. She spoke in support of oversight by the Board of Dentistry. She reiterated that risks are minimal. She emphasized that the legislation privatizes. She acknowledged that there could be a problem with the transitioning the program. She offered a conceptual amendment: "Notwithstanding other provisions of this Act, clinical radiological equipment which has been registered under AS 08.36.075 (c) before January 1, 1999 shall be issued an initial inspection seal valid until July 1, 1999 after payment of the fee". Representative Martin refereed to subsection (f) on page 3: "Notwithstanding AS 08.01.075 and AS 08.36.315, the only penalty applicable to a licensee for violating this section is the imposition by the board in a disciplinary action of a civil fine not to exceed $5,000 for each violation." He questioned why it did not include license revocation. Ms. Krogseng observed that the dentist does not necessarily own the equipment. She felt that a $5,000 dollar fine would be sufficient. Representative Martin noted that "the board may not adopt a standard under this section that is more stringent than a standard applicable under federal law". He questioned why the Board should not have flexibility to issue regional standards. Ms. Krogseng observed that the federal government approves the manufacturer's standards. She maintained that FDA standards are stringent. Representative Kohring moved to adopt Amendment 1 on behalf of Senator Taylor. Amendment 1 would add include completion of a United States Department of Defense biomedical equipment technician's course and the International Certification Commission for Clinical Engineers and Biomedical Technology as allowable qualification for inspectors. Ms. Krogseng discussed the amendment. She maintained that the Department of Defense schools are very good. Representative Davies OBJECTED. He questioned if the new qualifications would be comparable. Representative Mulder announced that the amendment would be HELD. SB 160 was HELD in Committee for further consideration. SENATE BILL NO. 223 "An Act lowering the age requirement from 60 years to 55 years for purposes of senior housing programs; and repealing a provision relating to the interest rate on senior housing loans made by the Alaska Housing Finance Corporation." BEN BROWN, STAFF, SENATOR KELLY spoke in support of SB 223, on behalf of Senator Kelly, sponsor. He maintained that SB 223 improves Alaska senior housing programs in Title 18. He explained that the Senior Housing Revolving Fund was created in the Department of Community and Regional Affairs with the goal of creating senior housing projects. The Senior Housing Revolving Fund (SHRF) has only been used once due to the merger of the state's programs into the Alaska Housing Finance Corporation (AHFC). The Senior Housing Revolving Fund could not compete with AHFC programs. Of the 9 senior housing projects only the Chester Park project in Anchorage has been financed by the Senior Housing Revolving Fund. Chester Park is also a cooperative ownership senior housing facility. The other projects are nonprofit rental facilities. He observed that SB 223 would allow the AHFC Board to reduce the eligibility age from 60 to 55 years of age on a case by case basis. The average age of senior housing occupants is 76 years of age. The original program was in the Department of Community and Regional Affairs. Since bonds were handled by AHFC, proceeds from were deposited into a bond account and periodically transferred to the SHRF account. Now that the program is in AHFC the bond account is not needed. The legislation streamlines the program by eliminating the bond account in AHFC. The SHRF will be the depository of future bond sale proceeds and repayments of principles and loans. The legislation eliminates a surcharge of either 2 points (for construction loans) or half a point (permanent loans) that was needed to pay for the administrative cost. Representative Kelly asked if sections 4 and 5 are the only sections that relate to age qualifications. Mr. Brown observed that section 6 deletes the statutory age of 60 for the Senior Citizens Development Fund. Grants are made from this program. The removal of the limitation will not open up the grant fund to the issuance of loans. The grant fund contains separate language that governs the age of eligibility. JOHN BITNEY, LEGISLATIVE LIAISON, ALASKA HOUSING FINANCE CORPORATION, DEPARTMENT OF REVENUE provided the Committee with information regarding SB 223. He observed that sections 4, 5 and 6 pertain to the age requirements. The legislation originally defined senior housing at age 55. There is an exemption under the federal Fair Housing Act, that allows exclusion of admission to individuals that are age 60 years and above. There is a provision that allows admission to individuals 55 years of age and above if 80 percent of the occupants are 60 years or above. There are two programs at AHFC. The SHRF provides housing for individuals that would not qualify as low income. He clarified that Chester Park was developed under SHRF. All other senior housing developments were financed under a program called the Special Needs Multi-family program. (Tape Change, HFC 98 - 161, Side 2) Mr. Bitney explained that the staff at AHFC put out a proposal to lower the age to 55 years of age. Concerns were raised regarding lowering to a blanket age 55. The Alaska Housing Finance Corporation adopted regulations that retained that age 60 limitation but allowed an exemption. Developments under economic distress can apply on an individual basis, for limited amount of time, to lower the age to 55 years. The current version of SB 223 adopts the age proposals by AHFC. The only reference to age is in section 4. The Alaska Housing Finance Corporation is given regulation authority in section 4 to establish any age. In response to a question by Representative Davies, Mr. Brown clarified that there is already criteria that governs the allocation of funds from the Housing Development Fund for low income housing. Mr. Bitney observed that the regulations outlined in section 4 would cover any loan from the revolving fund. The legislation does not make reference to the age limit under AS 18.56.800. Representative Davies asked if it would be desirable to extend the provision to AS 18.56.800. Mr. Bitney agreed that it would clarify the legislation. Representative Davies suggested that AS 18.56.799 be changed to AS 18.56.800. Mr. Brown suggested that change include AS 18.56.810. He pointed out that this would capture both sections that deal with the Housing Development Fund. Representative Davies MOVED to ADOPT to delete "AS 18.56.799" and insert "AS 18.56.810". Mr. Bitney spoke in support of the amendment. He explained that the subsidy grant represents the difference between the total cost of construction and what the financing piece will be able to afford through the rent structure. By extending the legislation to AS 18.56.810 the subsidy grant would have the same definition as the loan program. One current project would be covered. He did not know how it would affect retroactive grants. Representative Martin expressed concern that lowering the age would increase competition for housing among those 60 years of age. He observed that there is more need for senior housing than is being met. Representative Davies stressed that the legislation would allow the Department the ability to adopt regulation to establish under what circumstance the age could be lowered from 60 to 55 years. The circumstances would not necessary be the same. Representative Mulder pointed out that the age could be changed to any number between 55 years or older. Mr. Brown stated that the amendment might not be necessary. He pointed out that AS 18.56.810 states that "senior citizen housing" has the meaning given senior housing in AS 18.56.799. He explained that the age 55 floor is only referred to in the regulatory authority section. He recommended that the legislation state "senior housing" means construction or improvement undertaken primarily to provide dwelling accommodations for persons 55 years of age or older. Mr. Bitney stated that if the status quo remains that AHFC would adopt the same regulations for the grant fund as for the loan program. Representative Davies WITHDREW the MOTION. Representative Kelly MOVED to report CSSB 223 (FIN)am out of Committee with the accompanying fiscal note. CSSB 223 (FIN) am was REPORTED out of Committee with "no recommendation" and with a zero fiscal note by the Department of Revenue, dated 1/28/98. SENATE BILL NO. 236 "An Act extending the termination date of the Citizens' Advisory Commission on Federal Areas in Alaska; and providing for an effective date." ANNETTE KREITZER, STAFF, SENATE LABOR AND COMMERCE COMMITTEE spoke in support of SB 236. She explained that the Senate Labor and Commerce Committee sponsored SB 236 in order to extend the Citizens Advisory Commission on Federal Areas in Alaska. The Commission would cease to exist after June 30, 1998 if it is not extend. The Commission evaluates federal management, operation, planning, and development for consistency with federal law and congressional intent. The Commission also holds hearings on the impact of federal regulations and federal management decisions, makes recommendations to state or federal land agencies and reports annually to the governor and the legislature. There is a $93 thousand dollars fiscal note attached. Representative Kelly spoke in support of the legislation. STAN LEAPHART, FAIRBANKS testified via teleconference in support of the legislation. Representative Kelly MOVED to report CSSB 236 (RES) out of Committee with the accompanying fiscal note. There being NO OBJECTION, it was so ordered. CSSB 236 (RES) was REPORTED out of Committee with a "do pass" recommendation and with a fiscal impact note by the Department of Natural Resources dated 3/10/98. SENATE BILL NO. 358 "An Act relating to disclosure of the use of state funds related to personnel records." PAT DAVIDSON, LEGISLATIVE AUDITOR, LEGISLATIVE AUDIT DIVISION testified in support of SB 358. She explained that the legislation would divide investigations from personnel actions in regards to disclosure. Personnel actions would remain confidential. Public disclosure would be allowed when there is a misuse of state resources. The original legislation was limited to public funds. The Senate changed "public funds" to "state resources". Ms. Davidson reviewed the bill. Section 1(a) identifies that any state agency authorized by law to conduct a state audit can ask for the public release of information. They would have to ask the employee for permission to release information. If the employee declines a review procedure would be used as contained in subsection (c). This protects the employee by allowing someone outside of the investigation to look at it before it can become public. She observed that the Department of Administration, Division of Finance would appoint a review officer for cases involving employees of the executive branch, including employees of the University of Alaska. She suggested that the appointment be elevated to the commissioner or his designee. She observed that the bill states that the appropriate reviewing officer for employees of the judicial branch is the administrative director of the Alaska Court System. The appropriate reviewing officer for employees of the legislative branch is the: (1) director of the Legislative Affairs Agency for employees of the agency; (2) legislative auditor for employees of the division of legislative audit; (3) legislative fiscal analyst for employees of the division of legislative finance; ombudsman for employees of the Office of the Ombudsman. Representative Mulder questioned if the expansion from "public funds" to "public resources" was necessary. Ms. Davidson did not know how expansive the legislation would be under public resources. Representative Mulder observed that an $100 thousand dollars fiscal note accompanies the expansion. In response to a question by Representative Kelly, Ms. Davidson noted that as the agency conducting the audit that she would first ask the employee for a public release. Representative Davies expressed concern that there are certain aspects of personnel records that maintain privacy, which are not protected in other places in law. Ms. Davidson reiterated that the intent is to separate personnel action that has been taken from investigation results. Representative Davies acknowledged that it would be important to know that a state employee did an action, but stated that it might not be important to know the identity of the state employee. Ms. Davidson argued that public officials must be accountable for their actions when they are dealing with financial transactions. She noted that there might not be as clear a distinction with the use of "public resource". Representative Davies stated that he supports the general principle of the legislation. He stressed that there are already mechanisms for punishing wrongdoers. He emphasized that information would be helpful in cases where policy might be changed. He posed a hypothetical situation where a state vehicle was misused through an honest misinterpretation of the rules. He stressed that it would not be advantageous to punish the person and damage their reputation. The information would be useful for future policy decisions. KATHLEEN STRASBAUGH, ASSISTANT ATTORNEY GENERAL, DEPARTMENT OF LAW testified that the Department of Law has some reservations similar to those of Representative Davies. The Department of Law worked with the Legislative Budget and Audit Committee on the original legislation. They considered the limited issue of financial transactions during discussions. They agreed that there could be substantial injury to a person's reputation that is accused of misuse, fraud or embezzlement. The objection process solves a problem that is created under state and federal Constitutions regarding injury of reputation. There are accepted principles with financial transactions. The legislation would allow Legislative Budget and Audit Committee to use conclusions instead of doing their own audit. The Legislative Budget and Audit Committee could use public documents to question the employee. The fiscal cost would be zero without the change to "public resources". The use of public resource broadens those things that could be subject to grievances. She agreed that there needs to be debate about the misuse of public resources, but emphasized that an immediate problem could be resolved with a more limited approach. Ms. Strausbaugh stated that she has some reservations regarding name revealing. She gave the example of an accounting clerk that routinely messed up their work. She observed that an internal audit could be redone. Representative Martin stated that misuse of public money; land or resources should be public knowledge. Ms. Strausbaugh explained that the Department of Law only advises members of the executive branch to comply with AS 39.25.080. She emphasized that the legislation is a quick fix that was requested by the Legislative Budget and Audit Committee to deal with a specific problem that was costing them a lot of time. The Department of Law only advises their clients to uphold the law. Representative Davies noted that if the reviewing officer finds that the audit results are not based on substantial evidence or that the decision is unreasonable, the officer shall prohibit the public release of the audit results. He questioned if the audit results would then be made public. Ms. Strausbaugh said they would. Representative Davies concluded that the legislation does not allow the hearing officer to make a distinction between a case where it would be in the public interest to release the generic versus releasing the individual's name. Representative Martin observed that the Legislative Budget and Audit Committee has been careful with the use of names. Representative Davies noted that the information is available. He stated that he wanted to get the facts of the circumstance released to the public, but stressed his concern about instances when the individual is not charged. Representative Mulder felt that there are sufficient protections. ADJOURNMENT The meeting adjourned at 7:10 p.m. House Finance Committee 16 5/07/98 p.m.